Despite outrage in the UK, the LIBOR scandal lacks a clear class of victims.
“Does that mean the LIBOR scandal isn’t a big deal? Not at all. As I argued in this earlier post, it’s a very big deal. But it’s just a bit more abstract than your typical scandal. To see this, I’d propose the following (crude) analogy, in honor of yesterday’s baseball all-star game. Suppose the six wealthiest Major League teams got together and convinced the commissioner to move in every park’s fence ten feet without the rest of the league knowing. (Suppose they benefit because fans like to see more home runs hit, and they make their money on TV revenues.) The upshot is that some teams would give up more home runs and lose certain games, but some teams would hit more home runs and win certain games. Once the conspiracy was unearthed, fans of the first set of teams would complain loudly; fans of the second would probably keep quiet. But, overall, it would be hard to say that a certain class of team benefited more than another class. Or even that certain teams consistently benefited more than others. It would appear to be a kind of wash. (Yes, some teams are built more around hitting and some more around pitching, so you can imagine some small, systematic effect. But set that aside for the sake of argument.)
And yet, just because the conspiracy resulted in a wash doesn’t mean we shouldn’t or wouldn’t be outraged. All baseball fans would be outraged on some level because the integrity of the game had been compromised.”
— Noam Scheiber, “Why Hasn’t the LIBOR Scandal Blown Up? No Victims”